A limited constitutional government calls for a rules-based, freemarket monetary system, not the topsy-turvy fiat dollar that now exists under central banking. This issue of the Cato Journal examines the case for alternatives to central banking and the reforms needed to move toward free-market money.

The more widespread use of body cameras will make it easier for the American public to better understand how police officers do their jobs and under what circumstances they feel that it is necessary to resort to deadly force.

Americans are finally enjoying an improving economy after years of recession and slow growth. The unemployment rate is dropping, the economy is expanding, and public confidence is rising. Surely our economic crisis is behind us. Or is it? In Going for Broke: Deficits, Debt, and the Entitlement Crisis, Cato scholar Michael D. Tanner examines the growing national debt and its dire implications for our future and explains why a looming financial meltdown may be far worse than anyone expects.

The Cato Institute has released its 2014 Annual Report, which documents a dynamic year of growth and productivity. “Libertarianism is not just a framework for utopia,” Cato’s David Boaz writes in his book, The Libertarian Mind. “It is the indispensable framework for the future.” And as the new report demonstrates, the Cato Institute, thanks largely to the generosity of our Sponsors, is leading the charge to apply this framework across the policy spectrum.

Archives: 09/2010

Maryland Circuit Court Judge Emory A Pitt, Jr. has ruled that motorcyclist and Maryland Air National Guardsman Anthony Graber did not violate the Maryland wiretapping statute when he recorded his traffic stop. The wiretap law does prohibit the recording of audio where there is a “reasonable expectation of privacy,” but Judge Pitt found that a police officer performing a traffic stop has no such expectation of privacy.

“Those of us who are public officials and are entrusted with the power of the state are ultimately accountable to the public,” the judge wrote. “When we exercise that power in public fora, we should not expect our actions to be shielded from public observation.”

As I said in this op-ed, and as Clark Neily, Radley Balko and I pointed out in this video, Maryland police officers have used the “expectation of privacy” claim as a tool to deter anyone from recording on-duty police officers. In Anthony Graber’s case, a Maryland state trooper cut off Graber in an unmarked car and emerged from the driver’s side door in jeans and a gray pullover, gun drawn and badge not visible. It looked like a carjacking, and Graber was not charged for recording the encounter until he posted it on YouTube. The message to other Marylanders was clear: record the police, and you will face arrest and felony prosecution.

The prosecutor behind the case against Graber, Joseph Cassilly, spoke on a panel last week at Cato. He made clear that he disagreed with the structure of the Maryland wiretapping law, and was using the case to push the legislature toward a single-party consent wiretap statute. While I agree with a move to a single-party consent law, it is satisfying to see the charges against Anthony Graber reduced to the traffic violations that instigated the encounter in the first place.

The Venezuelan opposition has won an important victory—for now. In Sunday’s parliamentary elections it managed to receive 52 percent of the popular vote, which translates into some 60 out of 165 seats in the legislature, thus depriving Chavez of the two-thirds majority he needs to pass some laws and make some major decisions such as naming Supreme Court justices.

The victory shows that a majority of Venezuelans are tired of the regime’s autocratic ways and its results; it has emboldened the up-until-now ineffective and disorganized opposition; and it undermines the legitimacy that Chavez has claimed to have in speaking for the people (it will be difficult for him to continue to dismiss serious criticisms of his government as the concerns of a small oligarchy).

So life may be a bit more difficult for Chavez in the future, but it would be naïve to think that Chavez will suddenly begin respecting democratic institutions and let the election results stand in the way of his socialist revolution. He’s used every dirty trick in the book to subvert and silence his opponents—technical disqualification of candidates, gerrymandering, intimidation, de-funding local governments led by the opposition, exiling or jailing critics on false charges, shutting down media outlets, etc.—and to gain autocratic control of every major institution in the country.

Chavez will surely try to circumvent the legislature if it suits him. He has set up parallel government structures that he controls, and has spoken of creating local “communes” throughout the country whose decisions would override those of the parliament. Chavez controls virtually all government spending in an opaque process that imposes no accountability. It will be a challenging task for a new parliament to make spending transparent and accountable. The lame duck congress that lasts for the next three months (and that Chavez fully controls) can still pass a law empowering Chavez to rule by decree for any period of time that it chooses. So Chavez still has the ability to get his way.

In the end, politics matter, but the factor that will determine whether Chavez will be able to hold on to power may very well be economics. The economy is the worst performing in Latin America, inflation is about 30 percent, the country suffers power outages and water shortages, there is a scarcity of basic foods and other goods, infrastructure is crumbling and the dramatic rise in crime has made Venezuela one of the most criminally violent places in the world. It is no surprise then that most Venezuelans are fed up with Chavez. The rise in discontent, including among his base, threatens Chavez’s hold on power. Thus, the autocrat’s need to move fast in consolidating his revolution a la Cuba, at which point popular discontent matters little. Venezuela is still very much in a race between a deteriorating domestic economy and the completion of Chavez’s totalitarian project.

In Kelo v. City of New London, the Supreme Court ruled that a locality could use its eminent domain authority to seize private property to sell to private developers. Cato’s amicus brief opposing this abuse of the Takings Clause is available here, and an article on Kelo and other property law rulings of the 2004-2005 term by law professor James W. Ely, Jr. is available here.

One positive outcome of Kelo was the legislative restriction of eminent domain usage in state houses across the country. On the other hand, developers and localities have attempted to muzzle their critics with frivolous lawsuits. The Institute for Justice is currently litigating one of these actions in Texas:

Investigative journalist Carla Main wrote a book about eminent domain abuse in Freeport, Texas. The city is attempting to force out a generations-old family shrimp and marine supply business to make way for a luxury marina development that was to be owned and operated by Royall’s private company. When the victims of this eminent domain abuse complained, Royall sued them for defamation. Main’s book, Bulldozed: “Kelo,” Eminent Domain, and the American Lust for Land, tells the story of the Gore family’s generations-old shrimp business and how Royall and the city tried to take their land. Prominent law professor Richard Epstein (University of Chicago and New York University) contributed a blurb to the back cover of Bulldozed.

Royall sued Main, Epstein and Encounter Books (the publisher) for defamation over the contents of Bulldozed. He also sued two newspapers and a journalist who published reviews of Bulldozed. Royall is attempting to use the power of the courts to silence his critics.

A Dallas trial court ruled last year that the lawsuit was not barred by the First Amendment, even though Royall could not point to any statement in Main’s book that came close to the legal standard for defamation. The Institute for Justice is appealing the trial court’s decision. As Bill McGurn writes in today’s Wall Street Journal, this suit is one of the “high costs of Mr. Kennedy’s concurrence” in Kelo. Here’s hoping that rights protected by both the First and Fifth Amendments can prevail.

[L]obbyists connected to US Senators suffer an average 24% drop in generated revenue when their previous employer leaves the Senate. The decrease in revenue is out of line with pre-existing trends, it is discontinuous around the period in which the connected Senator exits Congress and it persists in the long-term. … Measured in terms of median revenues per ex-staffer turned lobbyist, this estimate indicates that the exit of a Senator leads to approximately a $177,000 per year fall in revenues for each affiliated lobbyist.

The fall is steeper, the researchers find, when the departing member of Congress sat on a powerful committee such as Appropriations, Senate Finance, or (on the House side) Ways and Means. Lobbyists who are ex-staffers are also more likely to quit the lobbying business once “their” member departs office. Incidentally, actual per-lobbyist revenue is lower than you might assume from the above figures, because many lobbying contracts are shared out among several participants with each individual getting only a portion of the proceeds. (Jordi Blanes i Vidal, Mirko Draca, and Christian Fons-Rosen, “Revolving Door Lobbyists,” via Alex Tabarrok).

If you needed another reason to vote against that unsatisfactory incumbent this fall, reflect that by doing so you’ll also be dimming the stars of his or her unsatisfactory ex-staffers.

With the addition of a poll by George Washington University and Politico – completed the day beforeObamaCare started sending health insurance premiums higher, making coverage less accessible for children, and destroying health insurance innovations – Pollster.com shows that among likely voters, ObamaCare now suffers a 10-point popularity gap:

(As I’ve noted before, Pollster.com’s local-regression trend estimate will head off in a direction different from public opinion if the latest poll is a fluke. But these trajectories are consistent with Pollster.com’s trend estimates for polls surveying registered voters and all adults, which incorporate many more data points.)

Also worth noting: ObamaCare has never enjoyed the support of a majority of likely voters or even all adults. For every poll that put ObamaCare above 50 percent – there have been only a few, and the highest showed only 53-percent support – many more polls clocked support at well below 50 percent. Thus Pollster.com’s trend estimate shows public support for ObamaCare peaked among all adults at 47 percent just after Obama’s inauguration, and has fallen to just below 40 percent today. Among likely voters (above), the high water mark was 45 percent in June, 2009, and now stands at just over 42 percent.

If Pollster.com does a fair job of smoothing out the quirkiness of various polls, that means ObamaCare has never enjoyed the support of a majority of Americans.

The House Republicans’ release of its “Pledge to America” has been met with criticism from across the ideological spectrum. While excoriation from the left was inevitable, those who were hoping that the GOP would set out a detailed agenda for limiting government were also not satisfied.

The 48-page document contains more pictures of Republican members of Congress than it does evidence that the GOP is seriously prepared to cut spending. While the introductory commentary is designed to appeal to the tea party movement, the actual “plan” to return budgetary sanity to Washington is both timid and incomplete.

The following are some thoughts on the pledge’s “plan to stop out of control spending and reduce the size of government”:

The document immediately notes that the “lack of a credible plan” to tackle the mounting federal debt causes uncertainty for employers and investors. The problem is the GOP leadership doesn’t have a credible plan to address the debt, or at least this document doesn’t offer one.

It disingenuously promises to “cut government spending to pre-stimulus, pre-bailout levels” when in fact it only intends to do so for a small portion of the overall federal budget. The reduction would apply to discretionary, non-security spending, which only accounts for about 15 percent of total federal spending.

Not only does the GOP punt on the big-ticket programs like Social Security and Medicare, the document devotes an entire section to maintaining the interventionist foreign policy that is helping to bankrupt the country. The GOP doesn’t appear to understand that the American people are having an increasingly difficult time understanding why the government continues to take bricks out of our own economy in order to build nations around the globe.

The document says that the GOP will “root out government waste.” Waste goes with government the way peanut butter goes with jelly. Nancy Pelosi has made the same promise, which demonstrates the vacuous nature of the proposal.

The GOP says it will cut the operations budget of Congress. That’s fine, but the legislative branch’s budget is only about $5 billion.

Calling for an end to the federal government’s control of Fannie Mae and Freddie Mac is a good idea. But that’s an easy position. They should instead be calling for an end to the government’s entire disastrous role in subsidizing homeownership.

The document calls for a freeze in federal non-security hiring. One would have thought the GOP would at least address exorbitant federal civilian employee pay. Freezing (or reducing) federal employment would take care of itself by eliminating agencies and programs, which is something the document doesn’t lay out a plan to do.

The GOP proposes to continue holding weekly votes to cut spending via its YouCut initiative. It’s a fine idea, but most of the cuts offered for consideration thus far have been relatively insignificant. For example, one of the cuts being proposed this week would “reduce funding for the wild horse and burro program to previously projected levels.” Not only would this only save $280 million over ten years, the GOP couldn’t even find the nerve to call for its outright abolition.

One piece of good news is that the GOP explicitly calls for the repeal of Obamacare.

With the Democrats content to irresponsibly promise more free lunches in the face of an unsustainable fiscal situation, it would have been refreshing for the House Republicans to square with the American people. However, with this document the GOP largely fell back on limited government platitudes.

To help kick off “Education Nation” – what NBC is calling an education-intensive week of news programming – Matt Lauer sat down with President Obama on this morning’s Today show. As expected, it was all talk, no real reform.

The interview started with a discussion of “Race to the Top,” the President’s $4.35 billion mechanical rabbit designed to make states run to implement ”reforms” the President likes. Lift caps on charter schools. Adopt national curriculum standards. Things like that. As his administration has done for months, the President spared no superlative prasing the thing, saying it is “the most powerful tool for reform that we’ve seen in decades.”

Uggh. RTTT did very little of substance, and even if the reforms seemed promising in theory we have absolutely no evidence of actual, positive effects on learning.

But the reforms don’t seem promising. Sure, RTTT got some states to lift caps on charter schools and eliminate some barriers to evaluating teachers using student test scores. For the most part, though, RTTT just prodded states to promise to plan to make reforms, and even things like lifting charter caps do little good when the problems go much deeper. Indeed, the only thing of real substance RTTT has done is coerce states into adopting national curriculum standards, pushing us a big step closer to complete federal domination of our schools. That’s especially problematic because special interests like teacher unions love nothing more than one-stop shopping.

But isn’t the President taking on the unions?

Hardly. While he has lightly scolded unions for protecting bad teachers, he has given them hugemoney-hugs to sooth their hurt feelings. Moreover, perhaps to further heal their emotional ouchies, on Today he offered union-hack rhetoric about teachers, going on about how they should be “honored” above almost all other professions, and how selfless and hard working they are.

Now, lots of teachers work hard and care very much about kids, but shouldn’t individual Americans get to decide how much they want to honor a profession, and how much they are willing to pay for the services of a given professional? Of course they should – who’s to say definitively whether a good teacher is more valuable than, say, a good architect? – but when government controls education, it decides what teachers “should” get paid.

Unfortunately, the President chose to seriously inflate how long and intensively teachers work, saying they work so hard they are downright “heroic.” No doubt many do work very long hours, but research shows that the average teacher does not. A recent “time diary” study found that during the school year teachers work only only about 7.3 hours on weekdays– including work on and off campus – and 2 hours on weekends. That’s 18 fewer minutes per day than the average person in a less “heroic” professional job. Oh, and on an hourly basis teachers get paid more than accountants, nurses, and insurance unerwriters.

Most troubling in the Today interview, though, was the President’s failure to even mention school choice – giving parents, not politicians, control of education money – as even a potential means for reforming education. He did, though, fully embrace his own educational freedom: When asked whether the DC public schools were good enough for his kids, he said no. That’s why they go to private school.

Here’s where we see the injustice of Obama’s and other like-minded people’s “reform” offerings. Rather than giving real power to the parents and kids public education is supposed to serve, they insist on keeping them subject to the authority of politicians and politically potent special interests. They refuse to let all parents make the same choice the President has made, and they continue to force all Americans to hand huge sums of money over to government schools. Indeed, at the same time the President’s kids were heading off to private school, he was letting die an effective, popular, school-choice program in DC, a program that enabled poor families to make the same kinds of choices the President did.

But educational freedom isn’t just – or even mainly – about equality. It is the key to unleashing systemic accountability and innovation, two essential things the President at least says he likes. Unfortunately, he has embraced at best a third-measure for getting these critical things, throwing his support behind charter schools.

The root problems with charter schools are that they are still public schools, and they are largely under the control of the districts with which they want to compete. So if they ever start taking big chunks of kids from the traditional public schools – if they ever impose real accountability by providing real competition – they’ll just be crippled or crushed.

The President suggested, though, that the main value of charters is not accountability, but that they can test new things. But letting a few government schools be a little different from the others won’t produce meaningful, constant, powerful innovation, especially if charters are kept from truly competing for students. Let parents take their education dollars to any school they wish, with no government thumbs on the scale, in contrast, and soon all schools will either have to get better, or go out of business.

Unfortunately, it seems that freeing all parents to pursue the education that’s best for their kids is a reform much too far for this President. Nothing, it appears, can be allowed to truly challenge the government schools.